How Should Companies Shape Their Rebate Systems?

Abstract

In general, price discounts provided in return of certain customer behaviors are called “rebate systems.” In regard to competition law, rebate systems arise as a result of either unilateral behavior of the supplier or through a meeting of the minds between customer and supplier. Rebate systems are distinguished from ordinary price reductions as they are provided to a group of customers due to conditions tied to the rebates applicable. In general, within the aforementioned condition, the customer is expected to commit an obligation proposed by the supplier, or it is aimed for the customer to adopt a certain behavior. Rebate systems are generally classified in the doctrine according to different criteria.